P. K. Langat & Andrew A. Mondoh v Raphael M. A. Juma [2001] KECA 289 (KLR)
The bottom line
#Kenya's Court of Appeal ruled that a sacked company manager sued the wrong people: directors and civil servants acting in their official roles aren't personally liable.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the proper defendants in the suit were MOCO and/or the Attorney General rather than the individual appellants.
- 2.Whether the decision to terminate the respondent's services emanated from the Board of Directors of MOCO, and whether the Special Board Meeting of 19th August 1992 lacked a quorum.
- 3.Whether the second appellant had authority to write the letter of 19th August 1992 retiring the respondent, and whether he was personally liable for doing so.
- 4.Whether the appellants, as civil servants acting in the course of duty, were personally liable in tort or whether the Government was the proper tortfeasor.
- 5.Whether the suit was competent without compliance with the Government Proceedings Act (sections 4 and 13A).
- 6.Whether the damages awarded by the High Court were payable.
Key legal issues
#Personal liability of a company director or chairman for acts done on behalf of the company
The second appellant, as Chairman of MOCO, acted as agent of the company and of its Board; he is not personally liable for the termination of the respondent's services.
Applying the agency principle in Palmer's Company Law, the court held that directors are agents of the company and the company, as principal, is liable on acts done in its name. The second appellant wore two capacities - civil servant representing the Government and Chairman/director acting for MOCO - and his actions in writing the retirement letter were approved and confirmed by the Board on two occasions. Whatever decision terminated the respondent's services was made on behalf of the Board; any claim lay against MOCO, not the Chairman personally.
Quorum of the MOCO Special Board Meeting of 19th August 1992
The High Court erred in holding that the meeting lacked a quorum where the memorandum and articles of association fixing the quorum were never produced in evidence.
The memorandum and articles of association of MOCO, which fix or enable directors to fix the quorum for board meetings, were not produced, so the parties were not ad idem on what constituted a quorum. Five of the nine directors were present on 19th August 1992, none raised the issue of quorum, board decisions were made by a majority of members present, and the Board approved and confirmed the second appellant's actions on two occasions. The trial Judge therefore gravely misdirected herself in holding the meeting irregular and incapable of transacting business.
Vicarious liability of the Government for acts of civil servants done in the course of duty
The appellants were authorised agents of the Government acting in the course of their duty; any tortious act was committed by the Government itself, not by the officers personally.
Applying the test in Hilton v Thomas Burton (Rhodes) Ltd and the passage from Salmond on Torts, the court asked whether the appellants were doing what they were employed to do. Although it did not approve of the over-zealous manner in which they executed the undisclosed orders supposedly from above, the appellants were employed to do what they did and their acts were not contrary to the express orders of their employer and were approved by the Government. Under section 4 of the Government Proceedings Act, liability in tort fell on the Government.
Compliance with the Government Proceedings Act
A suit against Government officers for acts done in the course of their duty must comply with section 13A of the Government Proceedings Act; non-compliance renders the suit bad in law.
Since the tortious act, if any, was deemed committed by the Government through its authorised agents, the proper remedy lay against the Government under the Government Proceedings Act, which by section 4 subjects the Government to liabilities in tort for its servants or agents. The respondent's suit, which named the officers personally, ought to have complied with section 13A of the Act; failure to do so rendered it bad in law.
Joinder of the appellants as parties to the suit
The appellants were wrongly joined; the proceedings against them were vexatious and oppressive.
The proper defendants were MOCO and/or the Attorney General, since the second appellant acted on behalf of the Board of MOCO and both appellants acted as authorised agents of the Government. The first appellant had no power over MOCO and could not order it to re-employ the respondent. If aggrieved, the respondent's remedy was a breach-of-contract claim against MOCO. Continuing against the individual officers was therefore vexatious and oppressive, and the suit against them fell to be dismissed.
Legal principles established
#- Directors are agents of the company; where they contract in the company's name it is the company, not the directors, that is liable, unless the directors undertook personal liability.
- A civil servant who carries out orders in the course of his duty is not personally liable in tort; the act is deemed committed by the Government, which is the proper defendant.
- A suit seeking to enforce a remedy in tort against the Government for acts of its agents must comply with section 13A of the Government Proceedings Act, failing which it is bad in law.
- A court cannot hold that a board meeting lacked the requisite quorum where the memorandum and articles of association fixing the quorum were not produced and the parties were not ad idem on what constituted the quorum.
- The master is liable where the servant was doing what he was employed to do, however improper the manner of doing it, even if negligent, fraudulent or contrary to express orders.
Court orders
#- 1.Appeal allowed with costs.
- 2.Judgment of the superior court (Ondeyo, J., dated 19th October 2000) set aside.
- 3.Judgment substituted with an order dismissing the respondent's suit with costs.
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court of Kenya at Nakuru
- H.C.C.C. No. 509 of 1992
- Jurisdiction invoked
- Not expressly stated in the judgment; the appeal was brought against the judgment and decree of the High Court of Kenya at Nakuru in H.C.C.C. No. 509 of 1992.
Relief refused
#Declaration that the appellants had no right to interfere with the respondent's employment
The appellants were wrongly joined and were not the proper parties; they acted as authorised agents of the Government in the course of duty.
Declaration that the second appellant was not authorised to write the letter of 19th August 1992 and that the letter and minutes were ultra vires
The second appellant acted as agent of MOCO and his actions were approved and confirmed by the Board on two occasions; he is not personally liable.
Declaration that the respondent remained an employee of MOCO and reinstatement to his employment
The proper defendant was MOCO; the respondent's remedy, if aggrieved, was a breach-of-contract claim against MOCO.
Permanent injunction restraining the appellants from barring the respondent's entry into his office or interfering with his duties
The suit was dismissed in its entirety as having been brought against the wrong parties.
General damages of Shs.150,000 for wrongful termination of services
The High Court judgment incorporating the award was set aside in its entirety and the suit dismissed.
Loss of income of Shs.477,259/20 for seven years from September 1992 at Shs.16,898/35 per month
The award fell with the setting aside of the High Court judgment and the dismissal of the suit.
Costs
"For these reasons we allow the appeal with costs. The judgment of the superior court is set aside and substituted with an order dismissing the suit with costs" - i.e., the respondent to bear the costs of both the appeal and the suit in the High Court.
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
For these reasons we allow the appeal with costs. The judgment of the superior court is set aside and substituted with an order dismissing the suit with costs.
where directors make a contract in the name of or purporting to bind the company, it is the company - the principal - which is liable on it, not the directors; they are not personally liable unless they undertook personal liability.
The tortious act, if any, must be deemed to have been committed by the Government itself inasmuch as it was committed by its authorised agents in their course of their duty.
the respondent's suit, if contemplated, ought to have complied with section 13A of the Act and failure to do so would have rendered the suit bad in law.
We hold that the proceedings against them were indeed vexatious and oppressive.
It is futile, therefore, for the respondent to complain that the second appellant had no colour of right or authority to write the letter of 19th August, 1992 terminating his services.
was the (servant) doing something that he was employed to do? If so, however improper the manner in which he was doing it, whether negligent ... or even fraudulent ... or contrary to express orders ... the master is liable.
Though we do not approve of the over zealous manner in which the appellants carried out the undisclosed orders supposedly "from above", we, nevertheless, see that the appellants were employed to do what they did.
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (1)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Sanyu International Limited v Oriental Commercial Bank Limited [2017] KECA 216 (KLR)[2017] KECA 216 (KLR)19 Oct 2017followed
Cite this brief
#Cite this brief
Caselaw, "P. K. Langat & Andrew A. Mondoh v Raphael M. A. Juma [2001] KECA 289 (KLR)", Case Analysis (2001). Civil Appeal No. 138 of 2001. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2001/289/eng@2001-11-16
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.